This disclosure relates generally to detecting fraudulent transactions in a payment card system and, more particularly, to computer systems and computer-based methods for comparing current financial transaction to spending patterns established by the cardholder.
Consumers that use credit and debit cards for purchases, both at brick and mortar stores and online, tend to make at least some of their purchases on a routine basis, for example, a cardholder may make the same type of purchases for approximately the same amount at the same stores or online outlets at relatively consistent time intervals. Fraudulent users of the cardholders' payment card tend to make purchases that do not follow the routine established by the cardholder. For example, a fraudulent user may use the cardholder's payment card at different types of stores than the cardholder routinely shops at. Further, the fraudulent cardholder may make larger purchases than the cardholder normally spends.
While the aforementioned payment instruments or cards generally provide account holders a measure of convenience to conduct various transactions, they are susceptible to fraudulent and/or other types of unauthorized use. For example, an unauthorized user may attempt to make purchases or conduct other transactions with a stolen or otherwise ill-gotten payment instrument or card. To protect against these fraudulent and/or unauthorized uses, various approaches have been previously implemented in an effort to ensure that only the account holder named or otherwise identified on the card is able to use the card. For example, the card may carry the account holder's signature. Accordingly, a signature provided by the user of the card at the time of the transaction can be compared to the signature on the card to verify that the user is in fact the account holder. In another example, the user of the card may be required to supply a PIN (Personal Identification Number) or other secret code before a transaction can be initiated with the card. In yet another example, the user of the card may be required to present some secondary form of ID indicating that they are in fact the account holder named or otherwise identified on the card.
Some degree of security against fraudulent or otherwise unauthorized card use is provided by the foregoing solutions. However, these solutions are limited in various respects. For example, signatures can be forged, PINs can guessed or otherwise become compromised, and false secondary IDs can be created or obtained by unscrupulous individuals.